In an exclusive interview with ABC News' Elizabeth Vargas, President Bush offered his views on a range of topics, including the response to Hurricane Katrina, the war in Iraq, U.S. port security and the future of his presidency. What follows is a transcript of the interview.

Watch World News Tonight at 6:30 p.m. ET for more.

ELIZABETH VARGAS: Let's start with Katrina, because today is the six-month anniversary of the hurricane hitting, and you know there have been a series of government reports evaluating the government response to that disaster. A congressional report assessed the U.S. reaction as "woefully unprepared" not only for a natural disaster now but for a terrorist attack, the state of readiness right now of the United States.

Setting aside future improvements that you plan, do you agree today with that assessment, that the United States is "woefully unprepared" for another natural disaster or attack?

PRESIDENT BUSH: I agree that we didn't do as good a job as we could have done on Katrina. However, I would remind people that there was a hurricane right after Katrina that hit Louisiana and Texas, and the response was much better coordinated, and the situational awareness on the ground was much improved. And so while I can't predict 100 percent success on a catastrophic — major catastrophic event, I can say that lessons learned from Katrina were being implemented quickly. And the case I make is that hurricane that hit down there in Texas is one where the response was much better.

Listen, here's the problem that happened in Katrina. There was no situational awareness, and that means that we weren't getting good, solid information from people who were on the ground, and we need to do a better job. One reason we weren't is because communications systems got wiped out, and in many cases we were relying upon the media, who happened to have better situational awareness than the government. And when you have the media [with] better situational awareness than the government, the American people are saying, "Wait a minute. What is happening? How come the federal Government and state government and local governments couldn't do a better job of providing information necessarily so that people could react better?"

VARGAS: So you don't agree with that report that calls the U.S. "woefully unprepared?"

BUSH: I think the U.S. is better prepared than woefully unprepared. There's no question we've got more work to do, and our report on Katrina outlined the work that needs to be done.

I thought, for example, the reaction to the 9/11 attack was a remarkable reaction, positively. When the terrorists attacked and destroyed two buildings, there were rescue teams rushing in to save lives. There was a response by the city that was a coordinated response. Katrina was one that we could have done a much better job [on], and we're learning the lessons from Katrina. But the country has got to constantly be evaluating our capabilities and preparing for the worst.

VARGAS: When you look back on those days immediately following when Katrina struck, what moment do you think was the moment that you realized that the government was failing, especially the people of New Orleans?

BUSH: When I saw TV reporters interviewing people who were screaming for help. It looked — the scenes looked chaotic and desperate. And I realized that our government was — could have done a better job of comforting people.

A lot went right, by the way. I don't want to denigrate the efforts of people that really worked hard. Our Coast Guard people were flying incredibly dangerous missions to rescue I think over 30,000 people from the roofs of their homes.

There was, you know, an amazing response from the citizenry who welcomed people who evacuated. And the state and the city evacuated a lot of people, and that caused there to be less loss of life.

But the chaotic scenes were very troubling. It just — it was very unsettling for me to realize our fellow citizens were in near panic wondering where the help was.

VARGAS: One more thing that the report said when they talked about how the government — the reaction by the government broke down. They were talking in particular about the Department of Homeland Security and FEMA. The House report called the federal response to Katrina "a failure of leadership." It describes FEMA as "undertrained, understaffed, and overwhelmed" and lay the blame for that with the Department of Homeland Security for stripping down FEMA. Do you think you're being well served by Secretary Chertoff?

BUSH: I do. I think he's doing a fine job. I also know he's willing to accept criticism and respond. That's the important thing. You know, Katrina has left a legacy, and the question is will we be willing to learn from the lessons. And that's exactly what you're beginning to see happening. We ordered a report right after Katrina hit. I said let us take a look at how better to prepare for the next disaster. And the government has been, one, very quick to analyze and, two, has now got a whole list of suggestions on which to implement in order so that we can do a better job and future presidents can learn from the lessons of Katrina.

VARGAS: But when these reports place so much responsibility at Mr. Chertoff's feet, if he were to offer his resignation to you, would you accept it?

BUSH: I don't think he's going to. Washington is a town full of a lot of criticism, and some of it is merited and some of it, you know, is not. But in this case, we take the criticism seriously and recognize that we could have done a better job and are responding accordingly.

VARGAS: Let's move to Iraq. This has been a rough few days in Iraq since the bombing of the mosque in Samarra. There's been a lot of sectarian violence. We heard fresh reports of violence again today and reports from Baghdad that the violence in these past three days has been the worst since the U.S. invasion of Iraq. There was a lot of criticism from both the Shiites and the Sunnis of the U.S. military for standing back and not doing enough to stop the violence.

What is the policy if, in fact, a civil war should break out or the sectarian violence continues? Are you willing to sacrifice American lives to get the Sunnis and the Shiites to stop killing each other?

BUSH: I don't buy your premise that there's going to be a civil war. There's no question that the bomber of the mosque is trying to create sectarian violence, and there's no question there was reaction to it. On the other hand, I had the duty, which I did, to call these leaders, Shi'a and Sunni leaders, as well as Kurdish leaders.

And the response was that we understand this is a moment that we've got to make a choice if we're going to have sectarian strife or whether or not we're going to unify. And I heard loud and clear that they understand that they're going to choose unification, and we're going to help them do so.

The presence of the U.S. troops is there to protect as many Iraqis as we possibly can from thugs and violence, but it's also to help the Iraqis protect themselves, and we're making progress in terms of standing up to these Iraqi troops so they can deal with, deal with these incidents of violence.

VARGAS: But what is the plan if the sectarian violence continues? I mean, do the U.S. troops take a larger role? Do they step in more actively to stop the violence?

BUSH: No. The troops are chasing down terrorists. They're protecting themselves and protecting the people, and — but a major function is to train the Iraqis so they can do the work. I mean the ultimate success in Iraq — and I believe we're going to be successful — is for the Iraqi citizens to continue to demand unity.

And remember, one of the things that's lost during this troubled week — and there's no question it's a troubled week — was the fact that 11 million Iraqis, about two months ago, went to the polls and said, "We want to have a democratic government." So there's still a will of the people there that are interested in a unified government.

Secondly, we're working with the leaders to form this unity government, and we'll see how it goes. We're making pretty good progress though. And I think the bombers really caused the leaders to say, "Wait a minute. We now have got to project civil war or civil strife or sectarian violence."

And the other side of the equation has got to be to train the Iraqis to fight so that the people feel like there is a unified security force that's interested in protecting them from a few people who are trying to sow violence and discord.

VARGAS: But there is a concern that when you talk to these political leaders that they don't wield the real power in Iraq, that it's the clerics that wield the power and the clerics who are controlling these militias, the militias who were responsible for most of the violence in the last few days.

BUSH: Well, Ayatollah Sistani, who is by far — not by far — is one of the most revered clerics, has made it very clear that this type of violence is not acceptable, and that he calls for a unified government. And matter of fact, many of the clerics have spoken out for a peaceful unified future for Iraq.

And there's no — look, these are — there are people that don't want to see democracy, and the reason why is because it defeats their vision of a totalitarian type government from which they can launch either attacks on America or future instability in the Middle East. You're witnessing this ideological struggle that's taking place, and Iraq happens to be the battle front for that struggle right now.

And I believe we're — we will prevail, and the definition of prevailing is an Iraq that can govern itself, sustain itself and defend itself, an Iraq that is not a safe haven for people like Zarqawi or al Qaeda and its affiliates, an Iraq which becomes an ally in the war on terror.

VARGAS: So let me make sure I understand you. No matter what happens with the level of sectarian violence, the U.S. troops will stay there?

BUSH: The U.S. troops will stay there so long as — until the Iraqis can defend themselves. I mean, my policy has not changed. To summarize it, as the Iraqis stand up, we will stand down.

And as you know, we've reduced troop levels this year, and that's because our commanders on the ground have said that the security situation in Iraq is improving because the Iraqis are more capable of taking the fight.

VARGAS: And if in fact the violence continues, will the Americans be forced to take a more active role in suppressing it?

BUSH: Well, the Americans are very active right now taking a role in suppressing it.

VARGAS: But as I said at the beginning, there's a lot of criticism from both the Sunnis and the Shiites that they weren't doing enough to stop the killing, and it was a lot of killing that happened after the upset attack.

BUSH: Well, I understand the criticism. It's also difficult sometimes to stop suicide bombers, and — but the Americans are — as well as coalition forces, and more importantly, the Iraqis themselves are patrolling and trying to keep neighborhoods safe.

VARGAS: You said this morning you reiterated your support once again for the deal that would allow a company from the United Arab Emirates to take over management of several U.S. seaports. If there are still concerns by some prominent members of your own party, other experts, even Democrats, about the security of this deal after the 45-day review, would you be willing to scuttle the deal?

BUSH: I want to know what those concerns were. Now, one of the reasons that we have a process the way we have is to make sure that people are able to analyze things in an objective way from a security perspective, not a political perspective. And, obviously, if people have concerns about the security aspects of a company that will manage terminals at ports, then I'd like to know what they are.

As I said, I was pleased that the company wanted to give Congress a 45-day review period, because I think it's very important for people to take an objective look at, at this proposal. And I want the American people to understand, if I thought in any way that a foreign company managing terminals would cause us to be less secure, I would, I would object strongly.
The security of our ports is managed by the Coast Guard and Customs. This company, like its predecessor, if the deal goes through, manages terminals. They're the off-loading facilities. This company would have a U.S. management team. This —

VARGAS: But even —

BUSH: Let me finish. This company, by the way, is purchasing this from a foreign — another company that is a foreign company. Many of the terminal ports in the United States are run by foreign companies, Chinese companies or Singaporean companies, and so it's — I can — listen, if I pick up my newspaper and see, you know, "Bush turning over ports to terrorist nations," I would be concerned, and I must confess, that was kind of the first blush.

And, and so two lessons from this. One is, obviously, Congress should have had a better heads up, and secondly, that the explanation to the American people must be done in a way that, you know, lays out the facts and doesn't frighten people. I mean it's —

VARGAS: But you haven't prejudged the 45-day security review. If in fact, there are still concerns, even if you don't share them —

BUSH: Well, there's a difference — well, there's a difference between somebody who has made up their mind regardless of the facts, and the facts, and so I want to hear what — again, I want to see the same facts presented to the Congress, and — but the 45-day period is a, is a good opportunity for people to find out the facts.

I do want, when people start paying attention to this, the facts, one is ask the question whether or not, you know, doing business with this company is going to jeopardize the security of the United States, first. And secondly, if not, what kind of signal does it send to say it's OK for a British company but not OK for an Arab company to manage this port, when in fact, this same company manages ports all around the world?

Here we are trying to put a coalition of the willing together to protect America, to win the war on terror, and I would ask the critics and the people who are skeptical, "What kind of signal does it send to our friends in the Arab world, people who are joining us in the war on terror, people who want to fight off the terrorists, to say it's OK for one company from one country to be able to have this management contract but not you?"

And I also want to remind people that in the year 2000, prior to my arrival in Washington, D.C., our country sold F-16s to the very country from which this company comes from. In other words, there had been a security analysis done on whether or not the UAE, for example, is a valid ally and our valued ally and — but, anyway, look, I can understand people's concerns, and our job is to address them.

VARGAS: Are you at all concerned about the fact that the Coast Guard had concerns about intelligence gaps in assessing whether or not this was a risk?

BUSH: I think if you looked at that full study, you'd find that the Coast Guard had some questions, but then those questions were answered. I would be concerned if the questions weren't answered. And so the Coast Guard questioning was the beginning of the process, in all fairness to the process. And to me it shows the process worked. Those people had these initial concerns. These concerns were addressed with the company, and those who analyzed the deal from a security perspective said that the questions were addressed.

VARGAS: I guess I just want to know if you're open to the possibility of this deal not happening, if that is an option here.

BUSH: You know, it — and the only way it won't happen is if there is a true security threat to the United States of America.

VARGAS: Something unearthed that you're not aware of in the next 45 days.

All right. You're on your way to India and Pakistan.

BUSH: I am.

VARGAS: You've called Pakistan one of our more important allies in the war on terror. But roughly 75 percent of Pakistanis have an unfavorable opinion of the United States; 51 percent think Osama bin Laden would do the right thing on the world stage; only 10 percent say the same about you.

This is our ally in the war on terror. What does this say about the state of your effort to change the opinion of the United States in the Muslim world?

BUSH: You know, if I made decisions based upon polls, I guess I would be hamstrung. I make decisions based upon how to protect the American people and how to do my job and how to work with others to spread liberty and democracy no matter how hard it is.

Secondly, you know, I don't know the survey you're referring to, but I do know that our country gained great goodwill as a result of our efforts to help relieve the suffering from the earthquakes. And so my trip is one to say to the Pakistani people, "We care about you," and there's tangible evidence to show we do because we are spending half a billion dollars to help the country recover and rebuild from this devastating natural disaster.

Secondly, I'm going to talk to my friend President Musharraf and remind him that we have a common enemy in al Qaeda, and so long as al Qaeda is plotting and planning in the neighborhood, we're going to need to work together to stop those plots. This is a man who's had his life threatened I think four times by al Qaeda; in other words, four attempts on his life. And so he knows firsthand how dangerous these folks are.

But our agenda's bigger than that. Our agenda is also one of you don't have any bilateral investment treaty so that we can continue the possibility of open trade with Pakistan. So I'm looking forward to it. It's a good chance to say to people, look, we care about you, and we've got a common agenda.

VARGAS: President Musharraf has been candid about talking about the challenges, though, of being an ally in the war on terror with a population that is so divided, some of it so openly supportive of al Qaeda and Osama bin Laden. He told us in an interview last summer that he actually hopes the United States finds Osama bin Laden in Afghanistan. It's a political headache for him to have to deal with that.

BUSH: He'll have to make a choice. That's the thing about this world. You know, sometimes it's not easy. Sometimes you have to decide.

VARGAS: Do you think he's doing enough, the Pakistanis are doing enough to find bin Laden, since everybody believes bin Laden is in Pakistan?

BUSH: We're looking and we've had some success against some of his lieutenants and allies. The war against terror requires constant pressure, the sharing of intelligence, the capacity to find these people lurking in remote regions of the world. And, you know, Western Pakistan is pretty remote. But I'll be talking to President Musharraf about the need to work together to find these killers.

VARGAS: If when you leave the Oval Office, the White House, Osama bin Laden is still at large, will you consider that a failure?

BUSH: What I'm looking at is management structure, operators, and whether or not we're doing everything we can to protect the American people. Of course, we'd like to bring him to justice, and we'll stay up — you know, the only thing I can tell the American people, so long as I'm the president, we'll stay on the hunt and we'll use resources and power and influence to convince others to join us on the hunt as well. And, you know, I'm an optimistic person. I believe we will bring him to justice.

VARGAS: I know you don't read the polls. You have said that many, many times.

BUSH: So what are you going to do, ask me about a poll?

VARGAS: I am going to ask about a poll, just the most recent poll that's out today that does have your approval rating at an all-time low for your administration. You don't care about that, but you have talked a lot about political capital, the importance of it, the value of it, your intention to use it. Do you think you have political capital right now?

BUSH: I've got ample capital and I'm using it to spread freedom and to protect the American people, plus we've got a strong agenda to keep this economy growing. The economy is strong. A good, healthy rate last year, productivity is up, we're creating jobs. The unemployment rate's 4.7 percent nationally. I mean, this is a strong economy.

And I talked to the Congress about how to make sure that we remain the leader in the world when it comes to economic vitality and growth for the good of our own people. And we've got a good, strong agenda, and I'm confident we'll be able to get a lot of the agenda through the Congress, including changing how we drive cars, getting unhooked from oil; including a competitiveness initiative that encourages research and development as well as educating children in math and science; health initiatives that empower the consumer and make sure the doctor-patient relationship is central to health care, health savings accounts.

We've got a very robust agenda, and I'm confident we'll get it through.

VARGAS: So you're not worried about that at all?

BUSH: No, listen, you know, I know people make a big deal out of these things. If I worried about polls, I would be — I wouldn't be doing my job. And, look, I fully understand that when you do hard things, it creates consternation at times. And, you know, I've been up in the polls, and I've been down in the polls. You know, it's just part of life in the modern era.

I think the American people — I know the American people want somebody to stand on principle, decide, make decisions and stand by them, and to lead this world toward a more peaceful tomorrow. And I strongly believe we are doing that, and I'm — I got to tell you, I'm enjoying it. It's a fantastic opportunity.

VARGAS: Finally, Mr. President, one last question. Just a few days ago, the legislature in South Dakota passed the most restrictive abortion law in this country with the intention, they say, of getting that all the way to the Supreme Court. They would like the Supreme Court to overturn Roe vs. Wade.

Will your administration file a friend of the court brief on that?

BUSH: I haven't paid attention to that, to this particular issue you're talking about. I can tell you I will put people on the Court without a litmus test. In other words, I haven't said to these judges, you know, "Give me your opinion on this case if it would be coming your way." And, you know, their job is to strictly interpret the Constitution.

So I am not going to prejudge how the Supreme Court is going to judge a particular issue.

VARGAS: This law would outlaw abortion except when a mother's life was at stake. The life was at stake, not health. Would you support that kind of law being the law of the land?

BUSH: Well, that, of course, is a state law, but my position has always been three exceptions: rape, incest and the life of the mother.

VARGAS: Rape and incest you would include?

BUSH: Yeah.

VARGAS: What about health?

BUSH: Well, health is, you know, the life of the mother is how I view health.

VARGAS: So you would lump that together. It doesn't have to be she's going to die if she doesn't get this abortion.

BUSH: No. I said life of the mother, and health is a very vague term, but my position has been clear on that ever since I started running for office.

VARGAS: All right.

BUSH: Thank you, ma'am.

VARGAS: Thank you so much, Mr. President. We appreciate the time today.

BUSH: Glad you're here.

VARGAS: Thank you. Good luck with your trip.

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